US intelligence officials have issued a warning to American businesses and company employees in China as sweeping updates to the country's counterespionage legislation go into effect on Saturday.
The National Counterintelligence and Security Center, which is part of the Office of the Director of National Intelligence, issued a memo on Friday outlining the new risks for American businesses operating in China under a recently passed revision to a counterespionage law in the People's Republic of China (PRC).
The law, which goes into effect Saturday, expands "the definition of espionage from covering state secrets and intelligence to any documents, data, materials, or items related to national security interests, without defining terms."
Intelligence officials are warning that any "documents, data, materials, or items" could now be "considered relevant to PRC national security due to ambiguities in the law."
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Additionally, the law also has the "potential to create legal risks or uncertainty for foreign companies, journalists, academics, and researchers."
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The revised law also poses challenges for private sector companies operating in China, as it expands the definition of espionage without providing clear definitions.
This ambiguity creates difficulties for businesses in understanding and complying with the law, which could have significant implications for their operations.
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Sen. Markwayne Mullin, R-Okla., expressed concern over the revision, calling it a "direct attack" on American citizens and businesses.
He stated, "When they talk about the word espionage ... and national security with no definition, that holds every American citizen that goes to China to do business or on vacation liable for just about anything the Communist Party of China wants to interpret and could arrest you and hold you in contempt."
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Mirriam-Grace MacIntyre, who leads the National Counterintelligence and Security Center, told the Wall Street Journal that the law expands the definition of espionage without defining terms in a manner that's "deeply problematic for private sector companies."
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The revised law is part of a group of laws that could give the Chinese government "legal grounds for accessing and controlling data held by U.S. firms in China."
Mullin argued that the move from China would not have happened under the Trump administration, pointing to alleged ties between the Biden family and the communist country. He stated, "There's no way, there's zero chance they would do this underneath President Trump."
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Mullin sees the revised law as an opportunity for the US to bring manufacturing and businesses back to America. He stated, "The issue that we have is what is the United States going to do about this? This is a great opportunity. And CEOs are partially scared, board members are partially scared.
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This is a great opportunity for the Biden administration, if they weren't so full of activists and actually be business-friendly, to say, 'Hey, look, we're going to open doors, we're going to streamline all the permits, allow you to bring your business right back to the United States.'"
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He believes that taking advantage of this new rule could lead to a surge in manufacturing returning to the US. Mullin said, "If we would take advantage of this new rule going into effect today, you would see an absolute swell of manufacturing coming back to the United States literally overnight."
The concerns raised by US intelligence officials highlight the need for American businesses and employees in China to exercise caution and be aware of the potential risks associated with the new counterespionage law.
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